When Your Sales Incentives Program Backfires

One great thing about sales incentives programs, especially rebate offers, is the near-immediate feedback you receive in the way of sales lift. “Is my program effective?” is a question that can usually be answered in simple terms of measuring the sales lift of the product being promoted. Arguably, this sales lift truly is the main goal of all channel marketing initiatives, but smart marketers know it really does make sense to drill a bit deeper and plan for a longer relationship with your consumers and channel partners.

I actually adapted the title of this article from a piece I was recently reading in the Harvard Business Review, also about incentives programs being at odds with favourable outcomes. In the article, one of the co-authors, Srikanth Srinivas, describes a long wait at a bus stop that caused him to be late for a client meeting. Frustratingly, bus after bus kept driving by the stop where Mr. Srinivas stood. When he recounted his experience to the client, they laughed and explained that in their town the transit system provides incentives to bus drivers to stay on or ahead of schedule. With this incentive in mind, drivers will often speed by stops where riders are waiting since the goal of staying on schedule can often conflict with the organization’s actual reason for existing: to move citizens from one place to another.

In our industry of channel marketing incentives, it is often important to pause and make sure the program your company proposes to operate is not at odds with its actual goal: winning over buyers. Winning over buyers in today’s context means not just having them choose your brand at the register but really having them identify with your company in a way where they think “that’s my brand” whenever they have a choice in a category you serve and, ideally, sharing with their personal networks how awesome they think you are.

What is the opposite of this desired outcome? There are two natural opposites: one is that your program causes them neither to buy your brand in the first place and, naturally, to not be their brand of choice in the future. In the context of this article, we are looking at the second possible opposite outcome: your sales incentive triggers the initial sale, but somewhere in the course of your rebate processing, that favour is lost due to a negative experience with your brand.

The principle at work here is a critical one: user experience. Somewhere in your program, perhaps the barrier to receiving the rebate became a little too high and so the customer does not end up even submitting their claim. Perhaps your program is rife with complication due to legalese or confusing terms and conditions. Perhaps something has been lost in the mail or, worst of all, perhaps the consumer follows up by phone, email or social media and the bad experience happens there. A rude person (or, worse, nobody) on the phone, an unattended social media account or email address can really take the shine off the customer’s relationship with your brand. Suddenly, your sales incentive program is backfiring and if it’s happening on social media, so much the worse.

The takeaway here is simple: always, always be keeping the user experience top of mind when you are creating your programs. Your sales goals will naturally follow and will be met when you focus on providing a great experience to the customers. Think like a customer; a real customer. Give them a great experience and they are sure to continue to choose your brand or, even better, share their story with others for months and years to come.

If you’d like to get into more detail about ways to avoid breakage in your sales incentives campaigns, please check out our free e-book Leveraging The Consumer Rebate. It contains easy-to-implement steps for optimizing your channel marketing initiatives and includes a worksheet to help you keep your eye on all the important stuff.